Remittances recorded an upward trend up to the equivalent of over three percent of Kenya’s Gross Domestic Product (GDP), the World Bank report
According to the 2019 Migration and Development report, remittances recorded in 2018 hit $2.720 billion (Sh272 billion) from $1.962 billion (Sh196 billion) recorded in 2017 which is a $750 million (Sh75 billion) increase.
Neighboring county, Uganda also recorded an increase from $1.166 billion to $1.245 billion making up to 4.5 percent of the country’s GDP. In Tanzania, the country recorded a $25 million increase equivalent to 0.8 percent of its GDP.
Remittances grew by almost 10 percent across Sub-Saharan Africa to $46 billion in 2018 with Comoros recording the highest shares followed by Gambia, Lesotho, and Senegal on countries’ remittances to GDP share.
Dilip Ratha, lead author of the new report said remittances were now “on track to become the largest source of external financing in developing countries.” According to Ratha, the high cost of money transfer leads to the reduction of benefits of migration.
Despite there being a global move targeting the reduction of remittance cost to three percent by 20130, still, the average cost of sending $200 remained high across the globe.
South Asia recorded the lowest cost of remittance at five percent while Sub-Saharan Africa was recording the highest average cost at 9.3 percent. Remittance costs across many African corridors and small islands in the Pacific remain above 10 percent.
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